7 days

7 Days is a weekly round up of developments in pensions, normally published on Monday afternoons. We collate this information from key industry sources, such as the DWP, HMRC and TPR.

In this 7 Days

EIOPA guidelines on PEPP supervisory reporting

On 4 June 2021, EIOPA published guidelines on supervisory reporting for the pan-European personal pension product (“PEPP”) under the PEPP Regulation. This Regulation is intended to provide greater choice for people who wish to save for their retirement, expanding the market for personal pensions through the creation of a PEPP (see 7 Days).

The aim of the guidelines is “to ensure the common, uniform and consistent application of PEPP supervisory reporting requirements regarding the details of the nature, scope and format of the information to be submitted by PEPP providers to competent authorities at predefined intervals and upon occurrence of predefined events”.

The guidelines will apply from 22 March 2022 and complement the related Delegated Regulations (see 7 Days) which were also published on 4 June 2021.

FCA encourages former BSPS members to consider claims process

The FCA has published a webpage dedicated to British Steel Pension Scheme (“BSPS”) steelworkers who transferred out of the scheme after receiving unsuitable advice, which the FCA found to be the case in nearly half of the cases it reviewed (see 7 Days). The webpage aims to help the members understand the claims process and whether they could be due compensation.

FCA publishes policy on costs and charges information

In 2019, the FCA consulted on requirements for workplace personal pension scheme providers to publish costs and charges data; it made final rules in February 2020 (see 7 Days). The first data publication under these rules is expected to take place this summer, when IGCs publish their annual reports.

On 3 June 2021, the FCA published its expectations for this first publication of data, and reminded firms it expects the information to be made available on a publicly accessible website.

The FCA has said that, following feedback from stakeholders, it will consider if it needs to consult on changes to its handbook “to provide clarity and ensure consistent good outcomes”.

Separately, in June 2020, the FCA consulted on rules setting out how IGCs should assess the value for money of workplace personal pension schemes and investment pathway solutions (see 7 Days). The FCA intends to publish a policy statement in response to this consultation in the summer.

Government rejects pension tax reform for now

On 2 June 2021, the Government published a response to the Treasury’s Committee’s “Tax after coronavirus” report (see 7 Days). This report discussed potential changes to the tax system to help “reconstruct” the economy in the wake of the COVID-19 pandemic and, amongst other suggestions, it recommended that “the Government should urgently reform the entire approach to pension tax relief”.

The Government has dismissed the need for pension tax reform for now, citing instead the immediate priority to focus on supporting businesses and workers to recover from the COVID-19 pandemic. However, the Government did note that it is currently analysing responses to the 2020 call for evidence on pensions tax relief administration in line with its manifesto commitment to review the differing outcomes for low earners between the two main methods of providing pensions tax relief (“net pay arrangements” and “relief at source”) (see 7 Days).

Government to reform HMRC statistics publications

On 27 May 2021, the Government has published its response on the reduction and consolidation of HMRC statistics publications, confirming it will discontinue publishing ROPS statistics and will consolidate the flexible payments from pensions, annual pension contributions by contribution type and personal and stakeholder pension statistics into one pensions statistics publication.

Government urges pension funds to invest in a green future and combat climate change

On 1 June 2021, speaking at the Net Zero Pension summit, MP and COP26 President Alok Sharma spoke of the need for pension funds to “commit to a net zero future” and reminded the industry of requirements to disclose climate risk in line with the TCFD, which are due to come into force later in the year. Final regulations mandating climate governance and risk reporting (see our Alert) are expected imminently

Speaking at the same summit, UN Special Envoy for Climate Action and Finance Mark Carney confirmed that the TCFD will consult “later this month” on the best practice for portfolio alignment metrics (measuring the extent to which portfolio investments are aligned to climate targets) and will also be issuing further guidance on this “critical tool” just before the COP26 conference in November.

ICO seeks views on anonymisation, pseudonymisation and privacy enhancing technologies guidance

On 28 May 2021, the ICO published a consultation seeking views on its first draft chapter of its Anonymisation, pseudonymisation and privacy enhancing technologies draft guidance. This new guidance will build on the ICO’s recently published updated Data Sharing Code of Practice (see 7 Days). It establishes definitions for anonymisation and pseudonymisation and explains their application in the context of the UK GDPR.

The ICO intends to publish further draft chapters for feedback at regular intervals and aims to produce a final version of this guidance for consultation this autumn. The consultation closes on 28 November 2021.

MaPS launches new standards for guidance and Beta MoneyHelper site

On 1 June 2021, MaPS announced the launch of its “MaPS Standards” which set out the core principles for the “effective delivery, quality and performance requirements of MaPS’ Debt Advice, Pensions Guidance and Money Guidance functions”.

Caroline Siarkiewicz, Chief Executive of MaPS, said: “The MaPS Standards will set the bar for how we should be working to support, engage and deliver for our customers… They will ensure that everyone in the organisation and our commissioned services has a framework from which to deliver the best consumer experience; to deliver a consistent, high quality of service aimed at improving people’s financial knowledge and to make informed decisions about their money.”

On 7 June 2021, MaPS released a Beta version of the website for MoneyHelper, the new consumer service to replace the three legacy brands of MAS, TPAS and Pension Wise (see 7 Days). The Beta version will allow MaPS to continue testing and to gather feedback ahead of the full consumer launch in June 2021. MaPS’ legacy brand websites and services will continue to operate during this transition period.

PDP report on engaging with pensions via digital dashboards

On 1 June 2021, the Pensions Dashboards Programme (“PDP”) published a “rapid evidence assessment” report to assist the MaPS in guiding the development of pensions dashboards in the UK. The report gathers evidence about the “barriers and enablers to engagement” with pensions and dashboards, as well as the evidence on the optimal functionality and dashboard presentation. Key barriers to engagement identified include inertia, “present” bias, friction costs, choice overload and lack of knowledge or ability.

Improving and measuring of transfer performance: STAR and FCA

STAR, the not-for-profit joint venture created with the aim of improving transfer times and customer communications (see 7 Days), has agreed on core management information (“MI”) to measure transfer performance, including for occupational DC pensions. The core MI will initially be focussed on the reporting of electronic transfers. The group said that agreeing core MI was a “key milestone”, as it would allow STAR to become “the single, authoritative source of transfer data on how firms are performing”. The FCA has also reiterated that reducing transfer times remains a key priority and that it is “strongly supportive” of STAR and “will actively be following STAR’s progress towards its objectives over the next 12 months.”

TPR urges schemes to digitise paper records

In a recent podcast, TPR urged pension schemes and their providers to both improve member data and the way such member data is stored ahead of the launch of the pensions dashboards system. Louise Sivyer, policy business lead at TPR, noted that some older workplace pension schemes still used paper-based filing systems and that this needs to be remedied well before the introduction of the pensions dashboards system.